In my last edition, I spent a lot of time articulating a pretty gloomy outlook of the economy and markets to come. Everything appears to point to things ending badly over the next year or so. The first phase of our prediction for the year seems to be playing out. The markets are in a bit of a rally mode as Q1 is beginning to wind down. We could see a little sideways to up action over the next couple of weeks as the calm before the storm. We’ll see. As we anticipate continued trouble for the year as a whole, we keep trying to figure out why it might go the other way and even establish new record highs…a possibility a recent Barron’s Magazine cover story suggests. The fact that we can’t establish a reasonable bull case scenario worries us a bit since the market always loves to surprise. The market could very well continue to ignore reality and power forward.

Barron’s asked whether the down turn that opened the year was a growth pause or merely a precursor to a looming recession. They side with the ‘pause’ case believing the economy will continue to grow leading markets higher. They find reinforcement in the low unemployment rate while ignoring stagnant wage growth and a deflated labor participation rate. Barron’s expectation for 2016 sees GDP growth of about 3.0%. Haven’t we heard this for each of the last eight years only to be very disappointed? Even if achieved, that growth level is hardly awe inspiring, but growth none-the-less.

February job numbers surprised to the upside as much as January’s disappointed. Year to date, employment data isn’t definitive one way or another while wage data shows a decline…not good. Some economists are using the recent numbers to declare the economy resilient…wish we could share that level of optimism.

The Barron’s article seems to dismiss the odds of a recession. However, we are now 7 years following the end of the last recession. In the post-WWII era, recessions have occurred about every five years on average. Thus, this worst recovery since WWII is getting a little long in the tooth. Looking at the above chart, the economy, and by extension, the markets experience their largest gains in the year or two following the end of a recession before beginning to give up ground in front of the next. What are the clues telling us today? Well, they’re not compelling to the upside. The case for significant growth seems to be getting tougher and tougher to make which is when we begin to ask ourselves even tougher questions as to what if we’re wrong.

The Case for Gold

We have had our eyes on gold of late. What follows is an excerpt from a recent piece Mike (my partner) wrote. We’re not recommending that everyone runs out and buys gold right now, but it may be worth watching. Gold, like all commodities, can be very volatile and risky.

“We believe that human nature does not change. That is why history so often repeats (or at least rhymes). From 1968 to 1980 Gold was in a secular bull market. During the middle of that bull market Gold (using the London Fix Price) moved from $185 per ounce in December of ’74 to a low of $104 per ounce in September of ’76. Less than four years later, February of ’80, Gold was trading at $675 per ounce.”

“If you subtract a zero, the price action in Gold looks remarkably similar to the ’74 – ’76 “correction”. In September of ’11 Gold traded to $1,895 per ounce using the London Fix price. In December of ’15, Gold traded at $1,069 using the London Fix price. If we subtract a zero, Gold has moved from $189.5 to $106.9 which looks an awful lot like the move from $185 to $104 during the ‘70’s.”

“We have no idea if history will repeat and we see Gold explode higher from here. We certainly believe that it could. The way that it has traded so far in ’16 has made us take note. During the past several years as Gold has moved lower – every rally has quickly been sold and price moved to new lows. That appears to have changed. Gold moved sharply higher into mid-February and after becoming massively overbought…it went sideways – something that “shouldn’t” happen. We have found that when a market does something it “shouldn’t” do, often times that is a market that is telling you something. We are paying attention.”

Naysayers believe the recent rally is rooted in fear which is generally not sustainable. However if market and economic fears turn out to be well founded, gold will be one of the safe havens investors will run to driving the price higher.

Tax Reform…Another View

I have been writing a lot about tax reform recently. The topic is hard to ignore during a presidential campaign year. I found an interesting piece by John Cochrane that I wanted to share: Here’s What Genuine Tax Reform Looks Like: WSJ 12/23. Cochrane is a senior fellow at Stanford University’s Hoover Institution. I loved his take, especially as it relates to tax on corporations and investments.

We probably all agree that the current U.S. tax code is an unadulterated mess. The subject of tax reform is politicized every four years, nothing is done, and we remain the patsies. It makes me crazy. I recently presented tax reform proposals from various candidates which are expansive, great for political theater, and absolutely necessary in support of a healthy and sustainable growing economy. Unfortunately, the probability of those plans actually seeing the light of day are pretty small, based on history.

Whatever our elected leaders land on will probably be overly complex as they bow to special interests and structure a system that will feed government’s growing and insatiable spending appetite. In its purist form, taxation is merely a redistribution of wealth. One entity takes from another entity and gives it to a third. By its nature, this process is inefficient and open to corrupting influences.

My personal belief is that, in a free market capitalistic society, lower tax rates foster greater economic growth which in the end generates more tax revenues as well as more personal wealth for people at all income levels. This has been proven time and time again. Since taxation is a necessary reality in the world we live in, it seems to me that the goal of the taxing authorities should be to create a tax policy that generates the critical revenues necessary while at the same time causing the least economic harm. Accomplishing this means that marginal tax rates must be lower, and the tax code must be massively simpler.

Cochrane’s ideal tax plan is both simple and fair. He believes it would also minimize potential economic damage. The details are as follows:

1. Eliminate the corporate Tax.

Every dollar that corporations pay and subsequently receive to produce, sell and deliver goods/services to the end consumer is taxed at many levels which translates to higher prices for the end consumer, lower wages for the workers, and lower dividends for the shareholders. In most cases there are layers of taxation in the equation. Think in terms of consumer products. The manufacturer’s suppliers all pay taxes as does the manufacturer, the transportation company that moves the goods, and the retailer that sells the goods.

This would allow business to spend more time and resources on productive activities and less on attorneys, accountants, and lobbyists seeking special deals.

The argument against suggests that this will unjustly enrich corporations and their greedy executives. While this may be true in the exception, competition will ensure the majority of those savings will be passed along to the consumer…you and me. In addition, there will be more left to devote to employee wages and benefits as well as to reward and encourage investment in growth.

Higher taxes hurt investors the least and the average citizen the most. Investors simply pay less for shares whose price is mostly tied to earnings. The average citizen pays higher prices or receives lower wages as a result.

With corporate taxes gone so are the arguments over investment expenses versus depreciation, repatriation of profits held overseas, too much tax deductible debt, R&D deductions, and a vast array of other types of deductions and credits.

2. Tax Consumption not Wages, Income, or Wealth.

Remember, when you tax something, you get less of it.

When government taxes savings, investment income, wealth or inheritance, it reduces the incentive to save, invest, and build wealth.

Taxes on capital gains discourages people from allocating capital to more productive uses.

The fact that complex tax shelter structures (special trusts and life insurance exemptions) and qualified accounts (IRAs, 401ks, HSAs, etc.) even exists is a recognition of the inefficiencies that exist with current tax law. If investment isn’t taxed, the need for these costly, complex structures disappear.

All the various complex tax credits and deductions would disappear…mortgage, charity, employer-provided healthcare, etc. would all go away.

Here is an interesting take on mortgage and charitable deductions:
i.What if the government announced that it will send an annual check to each home owner? People with high incomes who use lots of debt to buy expensive homes would get more than people with less income or who buy smaller homes or save and pay down their debt. The outrage will be deafening. However, that is exactly what the mortgage deduction does.
ii.What if Congress proposed to rebate back 40% of the charitable contributions that the rich make but only 10% for contributions made by middle class individuals? Americans wouldn’t stand for that yet that is exactly what the current tax code does.

Cochran suggests that consumption taxes can also be progressive. I’ll leave that up to people smarter than I am. While I like the concept of a consumption tax from a fairness standpoint, it seems that flipping from an income based tax system to a consumption based tax system would be very difficult before first vastly simplifying the current tax code.

If the politicians truly believe in tax reform that is based on the principles of fairness, simplicity, predictability and permanence, then a great start will be to eliminate corporate and investment taxes while at the same time ending deductions and credits as Cochrane suggests. Once they can agree on this, then they can begin to determine the appropriate progressive individual rates that would initially be revenue neutral. This is not that difficult to do if we can approach the process in an unemotional way that ignores all the special interest yelling and screaming. Once simplicity is achieved, we can debate the merits of a consumption versus income tax system. But, alas, I don’t hold out much hope that the current class of politician has the courage or appetite to do much of anything.

Hoarders

The settlement of final affairs as generations pass on should now include a more careful inventory of what is stashed away in the attic. Monetary policy in many corners of the world now innocent individuals to bypass banks and squirrel away cash in those proverbial shoe boxes in the dark interior recesses of the home.

Currently Japan and Europe have introduced negative interest rates which essentially charges individuals for depositing their liquid assets in banking institutions. Recent dialogue in the U.S. is floating the concept of negative interest rates. The intent is to motivate people and businesses to spend or invest their cash and stimulate the underlying economy as a result. Of course, this requires that there be desirable alternatives and opportunities available where individuals and industry are comfortable committing their resources. Those pickings are currently pretty thin.

Increasingly, bank customers, in the face of enduring negative nominal growth of their assets, are choosing to hoard their cash in order to most efficiently preserve value. This effectively slows growth of the money supply. As does high reserve requirements where banks have more cash than they know what to do with, but can’t lend it. The evidence of the hoarding trend is strong. Circulation of high-denomination currency (easier to store) is increasing at an unusually rapid rate at the same time as home safe sales are skyrocketing.

Instead of employing proven fiscal policy tools (tax and regulatory reform) to stimulate economic growth, governments and central bankers continue to push on a string prosecuting a war on cash. Larry Summers suggested that cash notes greater than $50 or $100 be banned globally. Harvard economist Kenneth Rogoff wants do away with cash all together. They disguise their true intent by attempting to justify their rationale as a blow to criminals and terrorists who avoid banks and use cash to conduct their business. In reality, this would allow central bankers to set negative interest rates without facing potentially massive withdrawals of cash from the banking system.

In the end, we need true reforms that will serve as incentives for the private sector to invest in growth…not negative interest rates and the elimination a basic tool of economic freedom…cash. Only real economic growth creates sustainable job and wage growth. Unbridled government spending coupled with class warfare and a continued demonization of success which manifests itself in the form of more taxes and regulation will only serve as a disincentive to this nation’s true growth engine.

Political Creative Destruction

We are all familiar with the process of economic creative destruction as old makes way for new. This is a necessary process that can be emotional in the moment but necessary in the long run as progress continues to power forward against the natural human tendency to resist change. Throw politics into the equation and progress often feels like swimming upstream in molasses. What we are now witnessing is the same evolution occurring within the Republican Party. The GOP is changing before our eyes while the establishment members of the party are fighting it tooth and nail as those wishing a new approach to chronic ineffectiveness push for dramatic change. This struggle for control of whatever the GOP party is becoming will be awkward and emotional. In the end, the economic impact will be profound which is where my true interests lie.

We are seeing a similar revolt within the Democratic Party as we painfully watch a cranky ol’ grandma argue with a curmudgeonly ol’ grandpa. Sanders generally wins the battle over who can give away the most ‘free’ stuff, but only by the slimmest of margins. Hillary has acknowledged Sanders for his effectiveness at engaging the support of young people, though I fear most confuse social-ism with social-media. Young people have always needed a cause even though most don’t know what it is or what the outcome may become. Having heard them in several debates and town hall meetings, the only differences that I can find between the two relate to honesty and integrity. Sanders appears to have both. Clinton has neither. Sanders, as a socialist, is the anti-establishment guy for the Democrats just as Trump is on the other side of the aisle. There is a bubbling insurgency occurring. The times…they are a changin’.

The GOP establishment does not want outsiders upsetting their cushy lifestyle. For the longest time the Republican establishment has told us they can’t win with only Republican votes which is why they support many traditionally progressive issues. However, guess who is actually winning votes from outside the Party? The person many love to hate…Donald Trump. He has put together a coalition of exactly what the Republican Party says it needs to win. Because he’s not a true Republican, the establishment reacts in a counterproductive manner because they are not in control of the outcome. They put Romney (I used to respect him) out there as a pawn of the establishment, and he demeans Trump being highly hypocritical in the process. It isn’t working, and in fact it appears to have pushed even more support Trump’s way.

There is nothing new here. This is exactly what happened as the establishment went up against Goldwater and again against Reagan. With Goldwater, the establishment threw the baby out with the bathwater. Reagan won in spite of the pressures. If you look back, I find it interesting that the things they were saying about Goldwater and Reagan are the same things they are saying about Trump today.

How much do you miss Reagan now? For most, it’s a bunch. How would the economic health of our nation be different today had Goldwater been successful? Face it…the GOP establishment is not conservative. Romney goes out and begins talking about how the Republican Party must stand for legitimate conservative values. The problem is THEY DON’T. So a very large segment of Republican voters are revolting as are Democrats.

Look at the primaries. The establishment doesn’t like either Trump or Cruz…the two most anti-establishment guys. Yet, they are the only ones who have won anything receiving 80% of the vote to date. No side will ever have a candidate that provides everything they want, so the voter will need to find the one who most closely resembles their vision…sometimes not an easy task.

Take Trump…lots to thumb your nose at, but there is a greater probability of positive economic outcome than negative results based on his core platform positions. Same for Cruz. The people seem to want somebody that is not from Washington or one that is at least is willing to fight the establishment. The disconnect between the people and the establishment is as wide as it’s been in our lifetime…well maybe since the 60s.

The GOP establishment has been telling us for decades that they are the ones that can fix everything, and yet they and the Democrats keep screwing everything up and ruining America in the process. The patience of the American people has worn out. They’re tired of listening to others say they can do things better than the people can for themselves and then end up making matters worse. The People aren’t buying it anymore and want to take back control of their own lives. Trump has become the Pied Piper of that discontent. On the other side, so has Sanders. Many want to paint this as a calamity. I’m not so sure. I believe it’s time for a change…not sure that Trump is the right guy, but someone has to break the establishment log jam.

Supporters of Trump, and Cruz to a lesser degree, find comfort from the candidate’s attitudes rather than their respective agendas which are not all that dissimilar. Devotees of these two outsiders seem swayed by the goals espoused and less focused on how they would be able to achieve those goals. Cruz provides more in the way of specifics. Ever the businessman, Trump evasively preserves room to maneuver.

Listening to the recent debates (for the record…they are not debates), the only one focused on substance is Cruz…maybe Kasich. Trump and Rubio act like third graders. Rubio won his Senate seat as a conservative Tea Party candidate and then became coopted by the establishment. He found it tough to get the toothpaste back in the tube. As a presidential candidate he attempted to go back to a very conservative narrative but ultimately was identified as an establishment guy and eliminated.

Political theater loves to suggest that the party is splintering with an implosion imminent. I doubt that will be the outcome. The process will arrive at a candidate and the Party majority will coalesce around that person and we’ll have an election. The process of creative destruction will then move to the next phase.

Last year I went out on a limb suggesting outcomes that most would have readily dismissed at the time:

On Trump: I warned that everyone better take him seriously even though deep down, I too essentially ignored his chances. I believed that he was a force that was changing the political narrative. For a while he focused on the serious issues and then turned into a circus. Can he become an adult again? Probably.

On Clinton: I was a bit more emphatic predicting that, for a lot of reasons, she would never get her party’s nomination. I fully expected the weight of her scandals and legal problems would force the party to go elsewhere. When Biden refused to run, the die seemed to be cast, however, now it would appear her risk is greater than ever. We’ll see if the Clinton magic Teflon continues this time around as she seems to be a lock.

On a brokered/contested convention: I suggested that, given the breadth of declared candidates and the divergence of support, there was the real possibility of the first Republican convention since 1948 opening without any one candidate arriving with enough delegates to win the nomination in the first round of voting. That possibility is still looking very possible, but Trump could be hard to beat at this point. If it becomes a brokered/contested convention, expect all hell to break loose as the establishment guys attempt to wrestle back control. It could get real ugly even leading to a breakaway third party. America is probably the loser in that case.

For what it’s worth, in spite of the Republican’s childish behavior to date, it appears that it is their election to lose. Ignoring her potential legal troubles, there is little doubt at this point that Hillary will prevail as her party’s nominee. While Bernie has earned almost as many regular delegates, Hillary lays claim to all the super-delegates who have no allegiance to the voter, and thus the fix is in.

As I examine the playing field, this admittedly biased fiscal conservative does not see a path leading to a Clinton victory in the general election. It is appearing more and more that she is the wrong candidate and the wrong time. Here’s why:

She is the lone candidate of the establishment in the year of the insurgent. She is the epitome of the establishment that everyone seems to loath. Democratic socialist Sanders and Republican candidates Trump and Cruz (the only viable GOP candidates outside a contested convention) are as anti-establishment as they get and collectively command the vast majority.

Democratic primary turnout is wimpy while on the Republican side it is energized and robust.

A significant consensus of voters based on the exit polls consider Clinton to be a liar and untrustworthy. This is a crippling perception that will be tough to overcome.

Young people, especially young women, don’t like her and are put off by her argument that her gender is why someone should vote for her.

The FBI investigation into the alleged abuse of her emails and possible criminal exposure of state secrets is a huge cloud hanging over her campaign. While I believe it will be unlikely at this time that an indictment will result, the ever-present storm cloud will continue to call her integrity and trustworthiness into question.

There is a lot of other baggage that will haunt her as well: Benghazi, the Clinton Foundation conflicts of interest, speaking fees, and ties to Wall Street (perceived or real) to name a few.

At this point, she seems to stand up well, at least even, against potential Republican opponents, but they have yet to come after her. All their energies have been focused on their primary opponents. Most of her focus has been on hammering the Republicans with no opposition to date. That will soon change in a big way.

None of the above even begins to address the major issues that will dominate the campaign. The Republicans will focus on economic issues, illegal immigration, defense, tax reform, healthcare reform, government spending, and foreign policy. The Democratic platform will be heavy on social issues such as choice, marriage, climate, guns, defending ACA, and income inequality. Both will hammer the importance of who gets to appoint the next two or three Supreme Court justices.

The party who is successful in framing the debate will be the odds on favorite. As I see it, the Republicans win on the issues when ranked by importance and Hillary faces the big non-issue headwinds outlined above….a potentially lethal combination. The good news for her is that Republicans tend to run terrible campaigns (e.g. McCain & Romney). If that were to occur again, she could back in.

A special thanks to all the political cartoonists who add levity to these divisive times.

Random Thoughts

I have previously argued that the solution to the chronic minimum wage dilemma was to create minimum wage zones where the minimum levels were set based on local cost of living data. Once that was accomplished, the rate could be indexed to inflation and let to automatically adjust over time. We know that the cost of living in New York City is far greater than Kemmerer, Wyoming, so a national minimum wage makes little sense. Indexing the rates to inflation will remove the need to politicize the topic going forward for most except the Bernie Sanders crowd. Now we have Oregon implementing part of this concept on a smaller scale. The state minimum wage will be higher in cities than in sparsely populated rural areas. We can still argue whether the rates, which will be the highest state mandated levels in the nation, make sense in today’s economy…they don’t (my opinion). The increase will unfortunately eliminate jobs, but at least the concept makes sense. They did not index the rate to inflation, so the issue will eventually become a political football again, but it may be a step in the right direction…baby steps.

One of the allures of Donald Trump is the prospect of bringing a non-politician, businessman’s approach to management and problem solving into the White House. I admit to a personal bias towards anyone whose resume is absent of elective office and long on private sector global leadership responsibilities. That said, Trump’s recent condemnation of Ford and Nabisco moving a portion of their operations to Mexico along with the intent of adding tariffs to any production brought back to the U.S. seemed to somehow lack a true businessman’s appreciation of rational corporate decision making. Additionally, the narrative smacked of political manipulation from a person proudly claiming not to be a politician. Oddly, his position on this issue demonstrates one of the worst traits of politicians where they continually attack the symptom while failing to understand and deal with the disease. These two iconic American companies have elected to move some of their operations to Mexico due to onerous taxation, a burdensome regulatory environment, and unrealistic union demands under an administration hostile to business. Common sense would suggest that the solution to the problem is creating a more tax and regulatory friendly environment for business in this country that incents them to keep operations and the associated jobs here. The threat of tariffs does nothing to solve the underlying problem and only serves to hurt the consumer in the end.

Not that I need a reminder that I am gracefully aging, but it was recently pointed out that 50% of Americans alive today were not yet born the last time man walked on the moon. This includes the newest crop of voters now eligible to participate in this presidential election who all were born during the William Jefferson Clinton administration. Sandwiched in between then and now was Bush 43. For all intents and purposes, the only president they have ever known is Obama. They were only 3 or 4 when the World Trade Center towers were knocked down. As Bush governed, they were trying to contend with raging hormones and pimply faces while the rest of the world was focused on threats of terrorism and war. The 2008 credit crisis and near collapse of our financial infrastructure was only background noise to them. So now they will vote…well some of them might accidently find a polling place. There aren’t too many major responsibilities we would entrust to this demographic group yet, but we’ll let them practice on such an inconsequential task as electing the next president…at least they’ll be doing it while they still know everything. It also occurred to me that my 14 year old grandson will be eligible to vote in the 2020 presidential election. At least he can readily identify and name each of the top six Republican presidential candidates (when there were still six) and both Democratic challengers. I doubt most of today’s college students and first time voters could do the same.

On the topic of The Supreme Court, Ted Cruz succinctly summarized what is at stake with this year’s presidential election when he said, “Two branches of government hang in the balance – not just the president but the Supreme Court.” Given that the next president will likely make 2-3 Supreme Court nominations, the stakes have never been higher. Throw into the equation that control of the Senate is also in play, one could argue that this is indeed the most important election of our lifetime. I know…they all are, but this one even more so given how the outcome may impact all three branches of government. President Obama surprised me by making arguably the most conservative SCOTUS nominee that a Democratic president has appointed since FDR. Justice Merrick Garland has an impeccable pedigree, but he’s an old white guy. Let’s unpack this nomination. It was only made because Obama knows it will never be acted upon. If this was a serious candidate, it would have been a young, minority candidate with a very progressive resume. It was done as part of a political chess game move so they can hold it over the Republicans’ head as they are accused of obstructing the process. Republicans seem to be determined to invoke the Biden Rule: no SCOTUS nominee considerations during a presidential election year. My guess is that if the Republicans lose the election in November, they try to quickly approve Garland before the new president is sworn in. An interesting game with profound potential long term ramifications.

A little healthcare levity – this is merely anecdotal, but the message is illustrative of what is going on. It seems that two patients limp into two different doctor’s offices. Both are having trouble walking and may require hip surgery. The first patient is seen within an hour, is x-rayed the same day, and surgery is scheduled for a week later. The second patient is able to get squeezed in to see his family physician three weeks later. He then waits eight weeks to see a specialist and only then gets an x-ray. He gets his results a week later and surgery is scheduled six months out pending a review board’s decision on his age and remaining value to society. Why the different treatment plans? Well it seems the second patient was a senior citizen on Obamacare. The first patient was a golden retriever taken to a vet. Like most good comedy, it is created on a foundation of truth.

Taking a peek inside Hillary Clinton’s formative years, we can gain some insight to her ideological foundation. Her senior thesis at Wellesley College was a mostly sympathetic expose on Saul Alinsky…a community organizer and counterculture icon who is probably best known for his 1971 book Rules for Radicals. The book outlined twelve rules for radical community organizers to employ in order to disrupt what was perceived as an unfavorable status quo at the time. Alinsky is also offered as support for beliefs Obama has written about in his books. The eight principles listed below describing how to create a social state have wrongly been attributed to Alinsky. He never wrote these. A little research shows that they are really a modern version of Communist Rules for Revolution. Having confirmed that Alinsky was innocent, I went back and considered each of the points on their merits.
1. Healthcare – Control healthcare and you control the people.
2. Poverty – Increase the poverty level as high as possible, poor people are easier to control and will not fight back if you are providing everything for them to live.
3. Debt – Increase the debt to an unsustainable level. That way you are able to increase taxes, and this will produce more poverty.
4. Gun Control – Remove the ability to defend themselves from the Government. That way you are able to create a police state.
5. Welfare – Take control of every aspect of their lives (Food, Housing, and Income).
6. Education – Take control of what people read and listen to…of what children learn in school.
7. Religion – Remove the belief in God from the Government and schools.
8. Class Warfare – Divide the people into the wealthy and the poor. This will cause more discontent and it will be easier to take (tax) the wealthy with support of the poor.
The economic implications of each tactic within a free market, capitalistic society are enormous. Does any of this sound like what has been happening to the United States over the last four or five decades? If you’ve been paying attention, it does.

Many of you I’m sure were Downton Abbey fans. This historical period British Television series during the post-Edwardian era follows an aristocratic family through the early 1900s as we see English society rather quickly evolve away from a birthright driven hierarchy to a more democratic society that more closely resembles the very model our founders designed. A society where advancement both socially and economically was no longer determined by your family tree but by freedom, hard work, and a willingness to take risks. I found a recent episode’s scripted quote by Dowager Countess of Grantham (played by Maggie Smith) very interesting. “For years I’ve watched governments take control of our lives, and their argument is always the same – fewer costs, greater efficiency. But the result is the same, too. Less control by the people, more control by the state, until the individual’s own wishes count for nothing. That is what I consider my duty to resist.” I guess the more things change, the more they stay the same.

A golfer goes into the pro shop and asks how much a ball marker was. One dollar said the pro. The golfer handed over his dollar, and the pro gave him a dime. And now you know the Bernie Sanders tax plan.

Critics Corner

RACE. Talk about a double entendre. This movie was the Jessie Owens story. Like so many other ground breaking, true stories like Jackie Robinson’s or the Miracle on Ice, a well done movie has you sitting on the edge of your seat even though you already knew the outcome. Armed with present day enlightenment, we look back with moral outrage at how minorities were treated at a different time…in a different era. It was a time where the cringe-worthy behavior was the rule as opposed to the exception. My take away may be a little different. What I saw was how far we’ve come along with how far we still have to go, but in the land of the free, the sense of right will win out. In the 1930s and 1040s, society was just beginning to naturally evolve away from one of overt racism to where some of the barriers were being challenged and knocked down. It wasn’t happening because some political party or government mandate legislated it to happen. It was happening because it was the right thing to do. The Civil Rights Movement was born out of this evolution where minorities seized the reigns and fought for their rights. The evolution continues.

In January, I discussed O’Reilly’s book Killing Reagan. The passing of Nancy Reagan closes the book on one of the most dynamic couples to occupy the White House. In Ronald Kessler’s book In the President’s Secret Service which recounts various presidential couples from the perspective of the agents that are tasked with protecting them, he described Ronald and Nancy Reagan as follows: “The real deal, moral, honest and dignified. They treated Secret Service and everyone else with respect and honor, thanked everyone all the time. One favorite story was early in his Presidency when he came out of his room with a pistol tucked on his hip. The agent in charged asked, ‘Why the pistol Mr. President?’ He replied, ‘In case you boys can’t get the job done, I can help.’ It was common for him to carry a pistol. When he met Gorbachev, he had a pistol in his briefcase.” On Nancy, he wrote, “She was very nice but very protective of the President and the Secret Service was often caught in the middle. She tried to control what he ate. He would say to the agent, ‘Come on, you gotta help me out.’ The Reagans drank wine during State dinners and special occasions only otherwise they shunned alcohol. The Reagan’s were genuinely moral people.” RIP Nancy Reagan.

Have a great month,

Respectfully,

Bruce

Bruce Anderson, Managing Partner: South Georgia Capital, LLC, 2135 City Gate Lane, SUITE 460, Naperville, IL 60563
630-447-2760 bwa@sgcim.com www.sgcim.com
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